Problem 5-19 (AICPA Adapted) Flappable Company began operations on January 1, 2016 The entity provided for doubtful accounts based on 5% op annual credit sales in prior years. On January 1, 2019, the entity changed the method of determining the allowance for doubtful accounts using an aging schedule. 2019 2018 2017 2016 Credit smiles 15,000,000 9,500,000 8,000,000 6,000,000 Collections excluding recovery 11,700,000 8,200,000 6,700,000 4,500,000 Accounts written off during year 200.000 120,000 80,000 Recovery of accounts written off 100.000 40,000 35,000 None None Days Account Outstanding Amount Probability of Collection Sodays or less 3,000,000 95% Between 31 and 60 days 1,500,000 80% Between 61 and 180 days 1,200,000 75% Between 151 and one year 1,200.000 50% Over one year - to be written off 100,000 1. What amount should be reported as allowance for doubtful accounts on December 31, 2019? a. 1,350,000 b. 1,450,000 c. 1,250,000 d. 1,000,000 2. What amount should be reported as doubtful accounts expense for the current year? A. 500,000 b. 600,000 700,000 d. 400,000 3. What is the net realizable value of accounts receivable on December 31, 2019? a. 6,900,000 b. 7,000,000 c. 5,550,000 d. 5,650,000 144